Tuesday, May 14, 2013

Selling Ice to Eskimos

I just
read an amazing report, which says that Chinese buyers have purchased
20,000 kg of Darjeeling tea from India recently, and there is a
growing demand for it in the country. This premium beverage is a hit
with the Chinese youth in cities like Beijing and Shanghai and is
also doing well as a corporate gift item. The younger generation in
China is preferring black tea in the ready-to-drink packs.

It may
surprise many readers that till middle of nineteenth century, India
did not produce even a Kilogram of Tea. In the year 1835, a British
officer, Dr. Arthur Campbell, planted few tea plant seeds in the
compound of his bungalow in Sikkim with the help from the ruler of
Sikkim, The Chogyal. The seeds grew into fine trees. Encouraged by
the results, many British businessmen invested in Tea gardens in the
Indian states of Asaam and Bengal and tea production took off in
India.

Prior
to start of Tea gardens in India, all the tea that was consumed here,
was brought from Tibet. This Tea was imported in form of very hard
and black coloured bricks, each weighing 2 or 3 Kilograms. Many such
Tea bricks were placed in lamb skins, which were later stitched to
make a package. Such tea packages used to come to India from Tibet.
To make the brew from these bricks, a brick would be placed is a
large steel pot filled with water and placed directly on the fire.
The brew would be allowed to boil over the fire, till it was strong
and dark. Salt, Yak butter and Barley would be added to the brew and
the Tea drinkers would get their wooden cups filled from the pot on
fire with the help of a ladle and satisfy their craze for this brew.

Even
though the Tea bricks came to India from Tibet, it was not produced
there. Tea gardens wear located to east of Tibet in southeast Yunnan,
a province of China, in the vicinity of Mekong river. The region here
is mountainous and hilly. Tea plants were grown and are still
continued to be grown on the gentle hill slopes around here. The
famous Tea from this region is known as “Pu'er” Tea. This region
is extremely picturesque with snow clad peaks in the background,
forests of Deodar, Birch and Fir trees, abundance of beautiful blue
water lakes and crystal clear weather with zero pollution.

Tea
bricks were then exported to India through capital of Tibet, Lhasa.
The route through which the Tea bricks would be transported to India
was a very difficult trail passing through mountainous regions and
was known as Tea caravan Trail. This trail started in the vicinity
of a village known as Xishuangbanna located in southeast Yunnan. From
here. the trail passed through Lijiang and crossed Yangtze river near
'Tiger-leaping Gorge'. It continued to Zhongdian near Tibet border
and then crossed into Tibet at Deqin village. From there it went on
to Lhasa through extremely mountainous region. From Lhasa the trail
would reach Sikkim through Nathu-La pass and then to India.

When
Tea production picked up in India, there was no demand for Chinese
grown Tea any more and eventually caravans bring tea by Tea Caravan
trail, stopped bringing in Tea. India is now world's second largest
Tea grower.

But
now, things have reversed. The fact that huge orders are being
placed for Darjeeling Tea by Chinese buyers, might look very odd.
Something like selling sand to Arabs or ice to Eskimos. China is
offering $15-$40 per kg (Rs 810 to 2,160) depending on the quality.
At times, they are offering even better prices than the Europeans.
India's tea exports to Britain, the biggest European market for the
beverage, has taken a hit from 22 million kg a year to 16 million kg
over the past five years with Kenyan tea gaining at the expense of
the "thick" India black tea. Total annual consumption of
tea in Britain is about 100 million kg, of which nearly 60 million kg
is imported from Africa.

The
reasons for this sudden increase in intake from China is a heart
warming news for tea growers, In China, tea is considered among the
seven necessities, along with wood, rice, oil, salt, soy sauce and
vinegar. New tea boutiques that have come up in Beijing and Shanghai,
who are selling Darjeeling teas. It is possible that Chinese
importers may even buy more teas at a better price in the new
season.

Black
tea market in China is actually growing and there is demand for both
Assam and Darjeeling teas. Darjeeling tea is being consumed by upper
middle class people while CTC (Assam tea) is consumed by the middle
class people. China, which produces green tea, may turn out to be a
major market for Indian black tea. The growing acceptance of Indian
tea in China appears to be part of a new global trend among younger
consumers to try out different varieties of the beverage.

China
produces 1475 million kg of green tea annually yet black tea is
gaining ground in China. This is something similar to more urban
Indians turning to green tea. The market share of green tea has
actually risen to 31 per cent from 17 per cent worldwide over the
past decade. Yet the departure from tradition of drinking green tea,
appears to be more significant in China than perhaps anywhere else,
because drinking tea happens to be part of the culture of China, the
land where tea originated.